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To: Tony Viola who wrote (49195)	7/27/2001 12:36:12 PM
From: Road Walker	Read Replies (1) \| Respond to of 275872

Tony, re: Can you somehow show the Dell - Intel "deal" that gets Dell lower prices? It's perfectly legal to have a price list based on volume of purchases. I would guess that Dell get the best price from Intel, but they might not get a better price than a Compaq or IBM, but certainly a better price than a tier 2 OEM. If I were to structure a program for Dell, where a secondary objective was to keep out AMD, I would use a volume rebate incentive, probably quarterly. It takes some good forecasting. But you give, say a 3% rebate on purchases, if the account reaches a threshold of XX thousand units. You set the XX amount at a level where you expect Dell to be with their total purchases. If they buy competitive chips, they know there is a good chance they will miss the rebate threshold. If the account was thinking of switching 20% of their products to the second vendor, they are looking at risking 3% of their total purchases. That change in 20% of their business better be a very compelling profit story, to risk the 3% of total purchases, that goes right to the bottom line. I don't know that it's fair, but it's the way it works. The incumbent vendor always has a huge advantage in any product or component review. John